News that a popular cycling event will not be returning to a north Essex town because of budget cuts has been given a mixed reaction by councillors and retailers.

Colchester Borough Council has said it will not be hosting a leg of the Tour Series next year because it can’t afford the £80,000 it costs to put the event on.

The annual race which sees teams of professional cyclists compete around a town centre circuit attracts upwards of 10,000 people into Colchester, where it has taken place in four of the past five years.

The council’s portfolio holder for tourism, Labour councillor Tim Young, said the expenditure “couldn’t be justified” at a time when funding from central government was being cut.

He said: “I am a big fan of the event but it has been sacrificed on the altar of Mr Pickles’ and Mr Osborne’s austerity agenda.”

Lib Dem councillor Nick Barlow, who holds the portfolio for Regeneration, said a deciding factor was uncertainty over whether Essex County Council would be prepared to help finance the event, as it has done in previous years.

“The Tour de France is coming through Essex next year and they are likely to put their resources into that instead,” he said.

Alastair Grant, commercial director at Sweet Spot, the firm that organises the Tour Series, said he was “disappointed” at Colchester’s decision and said on average towns that host a stage of the Tour Series generate up to £500,000 in extra revenue due to spectators spending money on the day.

“We’ve had a great relationship with Colchester and it has had some of the best crowds we have seen in recent years,” he said.

But Michelle Reynolds, who represents traders in Colchester through the Colchester Retail and Business Association, said in the past shops have lost money on race days because the town centre has been closed off from traffic and people have not been able to get in.

She said: “No-one has ever done a proper cost-benefit analysis of the Tours Series but I do know some retailers didn’t even open their shops last year because they expected so few customers.”

Leader of the opposition Conservative group in Colchester, councillor Will Quince, said the council had no choice but to scrap the Tour Series in the light of its “bad” decision to close the council-run Abbots Activity Centre earlier in the year.

“There’s no way they could fund an event that costs as much in day as it does to run an activity centre for the elderly for a whole year,” he added.